Bad investment advice on hydro
August 5, 2012
Maurice Emmer’s latest attack on the hydropower plant contains many inaccuracies and empty speculations (“Propaganda oozes,” Letters, Aug. 1, The Aspen Times).
One he has repeated multiple times is the notion that it costs more to produce electricity at the new plant than at the existing Maroon Creek plant. He misleadingly compares the Maroon Creek plant, which has been paid for and now only has operating costs, with the building and operating costs of the Castle Creek Energy Center. A direct comparison is the Maroon Creek hydro plant, which went through the same financial cycle as will the Castle Creek Energy Center and emerged as one of our community’s lowest-cost energy sources. In fact, Maroon Creek and Ruedi are positive examples of good business decisions. Emmer is encouraging the public to dismiss this project. Had he done the same with Ruedi and Maroon Creek when they were being considered, the community would have lost out. Instead, these projects were built and paid for, and now Aspen customers enjoy some of the lowest electric rates in the state.
While both the Castle Creek Energy Center and the Maroon Creek plant are efficient at converting falling water into energy, in reality, a gallon of water produces nearly three times as much electricity at the Castle Creek Energy Center as it does in the existing Maroon Creek plant. Both are essential in contributing to Aspen’s clean-energy profile. To be clear, contrary to Maurice’s assertions, all changes in production at the Maroon Creek plant have been calculated and fully included in the project’s financial payback analysis. His attempt to say otherwise is misleading.
But forget water for a minute, and let’s look at an analogy closer to most people’s lives. Suppose a family has decided they need an additional car to meet their transportation needs. Their old car gets 10 miles per gallon and was paid off years ago. The new car will get 30 miles per gallon but has a new lease cost. The new car has a higher per-mile total cost during its lease period, but that will drop dramatically after the lease is paid. Maurice would have you believe that the new car is somehow far less efficient than the old car because its purchase price is included in his incomplete calculation.
If Maurice’s type of financial analysis were accurate, nobody would ever make new investments. Let’s stop with the misinformation and focus on real issues.
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